Make no mistake about it.

We are smack-dab in the middle of a depression and there is simply no way out of this until the excessive debt is cleared from the system.

Sure, we may see some positive GDP growth here and there, but the nearly one in four Americans that are out of work make it clear that real growth – sustainable growth – is not coming back anytime soon.

Our political and economic leaders would have us believe that recovery is just a few months away (now that it is obvious that the green shoots, recovery and return to normal of 2010 was a fabrication).

A Wall Street Journal poll in September of 2010 found that 26% of Americans surveyed believe that the economy will improve in the next 12 months. It’s probably because they smoke a healthy dose of mainstream media’s optimism opium every morning and fail to follow the no holds barred economic reports of people like David Rosenberg:

A depression, put simply, is a very long period of economic malaise. A series of rolling recessions and modest recoveries over a multi-year period of general economic stagnation as the excesses from the prior asset and credit bubble are completely wrung out of the system. In baseball parlance, we are in the third inning of this current debt deleveraging ball game.

You know you’re in a depression when interest rates go to zero and there is no revival in credit-sensitive spending.

The economy is in a depression when the banks are sitting on $1.3 trillion of cash and yet there is no lending going on to the private sector. It’s otherwise known as a liquidity trap.

Depressions usually are caused by a bursting of an asset bubble and a contraction in credit, whereas plain-vanilla recessions are typically caused by inflation and excessive manufacturing inventories. You tell me which fits the bill today.

When almost half of the ranks of the unemployed have been looking for a job fruitlessly for at least six months, you know you are in something much deeper than a garden-variety recession. True, we can’t see the soup lines; the soup lines are in the mail — 99 weeks of unemployment cheques for over 10 million jobless Americans. Don’t be lulled into the view that we are into anything remotely close to a normal economic cycle.

source: Zero Hedge – What is a Depression Anyway?.

It’s real and it’s happening right now – and it is likely going to get a whole lot worse.

Related Reading:

Rosenberg: This is a ‘Depression, Not Just Some Garden Variety Recession’

99er: ‘You Think I Look Forward to Collecting Unemployment? It Is F*cking Degrading’